House price co-movement and labor migration: Evidence from China

This paper examines house price comovement across U.S. metropolitan areas (MSAs). We develop a Markov-switching framework that includes a spatial similarity element based on distances between MSAs. Our approach allows for house price comovements that occur due to similar timing of downturns across groups or clusters of MSAs. The inclusion of the spatial element improves the model fit compared to a standard endogenous clustering model. We find seven clusters of MSAs, where each cluster experiences idiosyncratic house price downturns, plus one distinct national house price cycle. Notably, only the housing downturn associated with the Great Recession spread across all the MSAs in our sample; all other house price downturns remained contained to a single cluster. We also identify MSA economic and geographic characteristics that correlate with cluster membership. In addition, while prior research has found housing and business cycles to be related closely at the national level, we find very different house price comovement and employment comovement across clusters and across MSAs.

This paper uses a Markov-switching approach to examine why there is house price cycle comovement across some U.S. metropolitan areas (MSAs) but not others, and which MSAs cluster together for each of these reasons. Past studies have attributed common housing downturns in different regions as possible explanations for comovement. We explore other channels, and find some clusters based on common industry concentration (such as information technology), house price elasticity, as well as a cluster of MSAs that are desirable for retirees (in the sun belt). We find seven clusters of MSAs, where each cluster experiences idiosyncratic house price downturns, plus one distinct national house price cycle. Notably, only the housing downturn associated with the Great Recession spread across all the MSAs in our sample; all other house price downturns remained contained to a single cluster. We also identify MSA economic and geographic characteristics that correlate with housing price cluster membership, which implies comovement due to mobility of residents. In addition, while prior research has found housing and business cycles to be related closely at the national level, we find very different house price comovement and employment comovement across clusters and across MSAs.

The correlation across US states in house price growth increased dramatically between 1976 and 2000. This paper shows that the contemporaneous geographic integration of the US banking market, via the emergence of large banks, was a primary driver of this phenomenon. To this end, we first theoretically derive an appropriate measure of banking integration across state pairs and document that house price growth correlation is strongly related to this measure of financial integration. Our IV estimates suggest that banking integration can explain up to one third of the rise in house price correlation over the period.

The correlation across US states in house price growth increased steadily between 1976 and 2000. This paper shows that the contemporaneous geographic integration of the US banking market, via the emergence of large banks, was a primary driver of this phenomenon. To this end, we first theoretically derive an appropriate measure of banking integration across state pairs and document that house price growth correlation is strongly related to this measure of financial integration. Our IV estimates suggest that banking integration can explain up to one fourth of the rise in house price correlation over this period.

The subprime crisis provoked a growing study on international housing market linkage. Nevertheless, the extant literature fails to explore housing price co-movements in terms of culture and a country’s responses (e.g. housing market conditions and government participation). Employing the databases on cultural similarities, housing market conditions and government participation in 18 OECD countries over 1970–2016, this article suggests that culture similarities affect house price co-movements via information dissemination efficiency and investment conduct consistency. In addition, housing supply elasticity and government participation are able to mitigate house price contagion. Hence, to withstand external shocks, countries should pay attention to the role of cultural similarities in housing price interdependence. Moreover, it is necessary to ensure that housing supply is resilient and improve government participation.

Co-movement between house prices across different countries has important implications for global investors. I employ a new data set on international house prices to examine home value co-movements in G-7 nations. I find linkages that vary through time. In some periods, the correlations are negative, while at other times, these co-movements reach all-time highs. This pattern is consistent with previous research on contagion for other financial assets. Further investigation reveals, however, that contrary to some previous findings, there has not been a secular increase in house price co-movement over the last four decades.

Cyclical synchronization of home prices has important implications for monetary (and other) policies. Regional house price divergence, even over a business cycle, can inhibit labor mobility and prevent workers from moving to where they could add most to their own wages and overall growth. We study house price co-movement across the different UK regions with a method, that, unlike previously employed techniques, allows for time-varying estimates. We find first, that the UK exhibits more home price divergence compared to previously reported results for the US. Second, regions near London exhibit the most co-movement, and those further from London the most divergence. Third, London itself is in the “middle of the pack” in terms of synchronization compared to other regions. This may reflect London’s status as a “global city” and being the destination for housing demand from sources abroad. Lastly, segmentation has clearly been increasing, rather than decreasing in recent years.

Cyclical synchronization of home prices has important implications for monetary (and other) policies. Regional house price divergence, even over a business cycle, can inhibit labour mobility and prevent workers from moving to where they could add most to their own wages and overall growth. We study house price co-movement across the different UK regions with a method, that, unlike previously employed techniques, allows for time-varying estimates. We find first, that the UK exhibits more home price divergence compared to previously reported results for the US. Second, regions near London exhibit the most co-movement, and those further from London the most divergence. Third, London itself is in the ‘middle of the pack’ in terms of synchronization compared to other regions. This may reflect London’s status as a ‘global city’ and being the destination for housing demand from sources abroad. Lastly, segmentation has clearly been increasing, rather than decreasing in recent years.

Remittances by migrants along with migration itself are elements in a migrant familys intertemporal contractual arrangement. The reasons why the migrant and his family voluntarily enter into a mutually beneficial contractual arrangement with each other rather than with a 3rd party--are discussed and the conditions under which the contractual arrangement is self-enforcing are identified. Both parties can usually benefit from a number of Pareto-efficient mutual contractual arrangements. This gives rise to an indeterminacy problem solved through a bargaining process between the parties who consequently converge to a contractual arrangement implying a specific flow of migrant-to-family remittances. The chosen contractual arrangement reflects the relative bargaining powers of the parties and variables impinging upon these powers thus bear upon remittances. In the light of these arguments tests are conducted on observed remittance behavior across individual migrants in Botswana. (authors)

High Speed Rail commuting impacts on labour migration: The case of the concentration of metropolis in the Madrid functional area

We study the microlevel evolution of residential house prices using data on repeat sales on Manhattan Island from 2004 to 2015. We document that price comovement, even within a ZIP code, is a highly local and persistent phenomenon. The strength of such comovements vanishes with both spatial and temporal distance. Local underperformance is more persistent than local overperformance, particularly when house prices on aggregate level increase.

We study the micro-level evolution of residential house prices using data on repeat sales on Manhattan Island from 2004 to 2015. We document that excess price comovement is a highly local and persistent phenomenon. The strength of such excess comovements vanishes with both spatial and temporal distance. Local underperformance is more persistent than local overperformance - particularly when house prices on aggregate level increase.

This paper develops an approach to the analysis of labour markets in a metropolitan region, emphasising the interdependencies between submarket areas arising from housing-related as well as employment-related migration and from induced shifts in commuting patterns. Three distinct migration streams with differing sensitivity to distance are identified and separately incorporated in a simultaneous equation model in which employment growth, unemployment, house construction, and house prices are also endogenous. Results are presented for estimation of this eleven-equation model with cross-sectional data for seventy-one areas in inner London, outer London, and the Outer Metropolitan Area. Important linkages are identified between the availability of rentable accommodation, labour migration and thus unemployment, between long-distance migration, and rates of private construction both in the areas of original destination and subsequent dispersal, and between intrametropolitan housing-related moves and the consequent decentralisation of employment. The distribution of new housing and employment opportunities, more than residential preference, is seen as the key factor in locational change within the region.

본 연구는 우리나라의 소규모 개방경제인 특성을 고려하여 통화정책과 거시경제변수들이 주택가격과 전세가격 간에 동조화 현상에 동태적으로 어떤 영향을 미치는가를 분석한 다. 이를 위해 미국연방자금금리(FFR)를 블록외생성(Block Exogenous)를 가정한 SVAR (1)모형을 설정하여 주택가격과 전세가격의 동조화 현상을 동태적으로 살펴보았다. 먼저 CD금리, 산업생산지수, 소비자물가지수 등의 요인이 주택과 전세가격에 미치는 동시기 인과관계를 살펴보면, 주택가격은 산업생산지수와 전세가격이 증가하면 함께 증가하는 것으로 나타났으며, 전세가격은 CD금리, 산업생산지수, 소비자물가지수, 주택가격이 증가하면 함께 증가하는 것으로 나타났다. 한편 충격반응의 결과를 살펴보면, 주택가격은 국내외 금리의 1% 상승충격이 발생하면 감소하지만, 전세가격은 증가한다. 주택가격은 산업 생산지수의 1% 상승충격, 전세가격은 소비자물가지수의 1% 상승충격에 더 민감하게 증가 하는 것으로 확인된다. 하지만 이런 관계의 영향력은 시간의 흐름에 따라 최근 약화되는 추세를 보인다. 마지막으로 주택가격과 전세가격 간의 동조화 현상을 살펴보면, 동시기적으로 주택가격에 대한 전세가격의 동조화는 국내외 금리, 경기요인 등의 영향보다 주택가격 변화가 미치는 영향이 크며, 전세가격에 대한 주택가격의 동조화는 금리변화, 경기변화에 민감하게 반응한다.This study investigates the change of comovement between the house price and the rent price (hereafter Jeonse price). The methodology used in this study is the SVAR (1) model that assumes the US federal funds rate (FFR) to be block exogenous, and dynamically examines the comovement of the house price and the Jeonse price in the Korean housing market from 2004 to 2018. The main results are as follows. First, we found that the increase in house price is related to the increase in the industrial production index (IPI) and Jeonse price. We also found that the increase in Jeonse price is associated with the increase in the interest rate, IPI, consumer price index (CPI), and house price. Meanwhile, we find that the house price decreases in the 1% upward pressure of domestic and foreign interest rate shock. However, Jeonse price is only influenced by the domestic interest rate shock. It is noted that the increase of IPI and CPI commonly affects both the house price and the Jeonse price. Second, we carried out a rolling regression analysis in order to identify the dynamic casual relationship. We find that the impact of house price and Jeonse price from the IPI and CPI decrease as the interest rate goes up in the global financial market. Finally, we analyze the comovement between the house price and the Jeonse price. We find that the comovement of Jeonse price on the house price is significantly influenced by the change of Jeonse price rather than economic factors, such as interest rate. However, the result shows asymmetry in the house price. The comovement of the house price in relation to the Jeonse price is further influenced by the change of interest rate or economic conditions.

The integration of industrial robot application (IRA) into various sectors has catalyzed significant transformations in the labor market, reshaping the dynamics of individual migration decision (IMD). As industries increasingly adopt automation, the implications for workforce distribution and migration patterns become critical areas of study. Based on the conditional logit model and using CMDS data, this paper explores the relationship between IRA and IMD, as well as the heterogeneity effect and influencing mechanism. The findings indicate that IRA reduces the probability of the floating population choosing the city, and the results are robust after considering endogeneity and further robustness test. The impact of IRA on IMD is heterogeneous. Relatively speaking, the floating population with high education levels, health, younger, unmarried, female, agricultural household registration, state-owned enterprises, and non-routine task work does not over-think the impact of IRA during the migration process. In addition, the floating population also considers geographical location, city size, marketization level, wage level, and environmental quality when making migration decisions. the mechanism test shows that IRA attracts or suppresses the floating population through factors such as wage levels, housing price level, difficulty in finding a job, etc., depending on the result of individual utility maximization. These insights reveal the complex interplay between technological advancements in robotics and labor migration, emphasizing the need for comprehensive policy frameworks to manage these transformations effectively.